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Granted, but look at it from a purely analytical point of view. The land lord has invested in the property, whatever property it may be. He/she is now renting o

Granted, but look at it from a purely analytical point of view. The land lord has invested in the property, whatever property it may be. He/she is now renting out that property to you to make a profit and has factored in the cost of upkeep, taxes, labor and wages for not only their staff but also themselves. That's renting. If you're renting a single house from a landlord who rents out a couple of houses, that margin is smaller, but they are still going to want to pay for those houses, costs and make a small profit. No one gets into these things to lose money. If they start to lose money, they fix up the property and hope for a good market, I would think.

hash872 5y ago
Well many, many rentals were originally owner-occupied SFHs or condos. So they weren't purchased to be profitable. From my experience at a commercial real estate brokerage, forming a personal relationship with dozens & dozens of landlords- it's an extremely unprofessional small business, attracted by people who think 'land, they're not making any more of it' is a sophisticated statement. It also attracts a lot of 'more money than sense' types who are willing to eat losses for the first 5+ years because they think they'll make more money over time. I would conservatively estimate 20-33% of new landlords are actually losing money every year. Could be way higher than that! Imagine saying 'there's tons of day traders, no one gets into day trading to lose money, so they must all be making $'. In fact, no- it just attracts a lot of unsophisticated folks. Same thing with owning a small retail business or a restaurant- there's lots of restaurants, they're also terrible businesses! I would put being a small landlord closer to owning a restaurant
- UnpossibleJim 5y ago
  That seem crazy... not crazy in the, "I don't believe you" sense, crazy in the sense that people would just keep rolling with losses in renting and not just flip houses, which is still a pain, but you don't have to deal with renters and are sort of doing the same job.

hash872 5y ago

Well many, many rentals were originally owner-occupied SFHs or condos. So they weren't purchased to be profitable. From my experience at a commercial real estate brokerage, forming a personal relationship with dozens & dozens of landlords- it's an extremely unprofessional small business, attracted by people who think 'land, they're not making any more of it' is a sophisticated statement. It also attracts a lot of 'more money than sense' types who are willing to eat losses for the first 5+ years because they think they'll make more money over time. I would conservatively estimate 20-33% of new landlords are actually losing money every year. Could be way higher than that! Imagine saying 'there's tons of day traders, no one gets into day trading to lose money, so they must all be making $'. In fact, no- it just attracts a lot of unsophisticated folks. Same thing with owning a small retail business or a restaurant- there's lots of restaurants, they're also terrible businesses! I would put being a small landlord closer to owning a restaurant

UnpossibleJim 5y ago
That seem crazy... not crazy in the, "I don't believe you" sense, crazy in the sense that people would just keep rolling with losses in renting and not just flip houses, which is still a pain, but you don't have to deal with renters and are sort of doing the same job.